Challenge:

The global TIMES industry was in a stormy crisis. In Q3/2008, earnings are down 18% on estimated made 12 month ago (Source: Datastream, Robert Shiller, Factset and Morgan Stanley Research). Advertising market are cracking in all segments including TV, radio, internet and outdoor. E-commerce is cooling off significantly. Telco subscriber growth declines and IT spendings go down given the slowing economy.

At the same time shareholders asking for higher returns? Competitive situation in saturated markets with cost-based competition? A strategic crisis that spills over into a profitability crisis that ends up creating a liquidity crisis?  These development patterns might lead to insolvency if companies fail to take quick and very focussed corrective action.

An increasing number of TIMES businesses operate in a saturated market environment. Intensive competition puts high emphasis on cost-based competitive advantages. Consequently, there is an increasing demand for TIMES companies to significantly raise their operational and financial performance of their business in the short or medium term or perform a restructuring exercise.

We understand the need for speed in most performance management and restructuring situations. Skillnet's unique industry expertise translates into speed of execution in such critical situations and helps the client to turn around the crisis quickly.

What We Do:

Skillnet’s proven and unique "performance management" methodology helps TIMES companies to significantly increase operational and financial performance quickly. Based on our "laser focus" expertise in TIMES, the performance management exercise acts carefully in order to not lose essential assets and, therefore, long-term business potential. One of our key USPs is the access to relevant benchmarks in the industry from a global and local perspective. The Skillnet support is focussed on a very structured process that contains an analysis of the strategic and operational situation of the client and the design and implementation of a "crisp" reliable implementation program.

Approach:

1. Understand the situation and identify areas of improvement

A dedicated team of specialists works with a team or a project lead from the client to implement the "performance management" methodology. The team begins by analyzing the strategic situation, operations and various positions of the P/L (cost of sales, rights, organization, sales/marketing, technology, etc.) und balance sheet in order to identify areas of improvement. The key performance indicators are gathered/measured and compared with relevant benchmarks from the Skillnet market intelligence database.

2. Develop restructuring concept and identify tools for perfomance improvement

Based on the results of the analysis, a restructuring concept will be developed, that targets relevant levers of improvement to the business. The restructuring business also defines top-down improvement objectives that ensure to heal the crisis and help the management to measure the implementation against. Based of the restructuring concept various tools for performance improvement are identified, quantified and put together into a detailed set of measures. The impact on operating result, long term assets, and required investment is taken into account and a business case is drafted.

3. Design and implement an effective improvement/restructuring program

Based on the defined measures, an overall program for implementing the performance management is designed. The program will focus on "quick wins" as well as on mid/long-term impact. Roles and responsibilities and clear leadership are defined and an objective-driven implementation controlled with clearly defined milestones is established and supported by our external support team. An on-going and detailed implementation controlling along with a change management help to implement the program effectively.

Results:

Systematic improvement of the operational and financial performance while also not losing the strategic assets and potential of the business. Turn-around of a company crisis in respect to profitability or liquidity. Focussed, quick and hands-on implementation with high reliability of achieving essential operations and financial gains.

Successful references proof ROI on Skillnet performance management projects

Skillnet successfully helped to improve performance of key industry players across all TIMES segments. Selected references are as follows:

In the Media/TV domain Skillnet supported Endemol in restructuring its operations, and implementing new IT systems to improve the operational and financial performance significantly. The project won the international performance award of the Endemol group and offered shareholders an internal rate of return of 80%.

Skillnet supported Siemens IT Solutions and Services (SIS) as a major Information Technology player in improving operational and financial performance. The IT services environment continuously faces cost pressure and need to maintain competitiveness. SIS leveraged Skillnet industry and performance management expertise to reshape the operational and overhead organization and mastered the offshoring transition of roughly 3,000 FTE to India.

The Telecommunication industry reached a mature stage in its market lifecycle. Established players in this domain such as debitel rely on Skillnet's capabilities to improve performance in production, development, customers support, and sales organizations. Skillnet's industry expertise and performance management know-how ensure a significant increase of operational and financial performance while maintaining the long-term company assets.